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Chinese President Xi Praises Blockchain in Governance

China’s President Xi Jinping said that the adoption of techs like blockchain, IoT, and cloud technology will better serve social governance again.

On March 11, ‘Xue Xi Daily’, a state-owned media issued an article named ‘How to Make Scientific and Technological Innovation Support the Public Opinion’, in which it mentioned that scientific and technological innovation is required to improve the social governance, especially for the battle against coronavirus outbreak.

“In some areas of our country, integrated management and dispatching command panel has been installed in practice to monitor and realize central dispatching command in real-time, so that the safety of personnel, communities, streets, urban areas and even the whole city can be covered seamlessly. This provides a solid and efficient technical support for the fight against the coronavirus.”

In his speech, Xi proposed that the government should use information technology like blockchain to better perceive social situations, unblock communication channels and assist in decision-making. To build the “smart governance” model, it is necessary to realize the sharing of information and data, integrate the Internet of things, cloud technology, blockchain and other technologies into social governance, thus serving social governance in the new era.

“The coronavirus outbreak is not only involving medical field, but also a social system, especially the public opinion field, which will affect the public’s cognition, mentality and behavior. The expression that ‘technological innovation supports social governance system’ is clearer and highlights the importance of intelligent social governance and security in the new era. Especially in the era of “Internet +”, the speed and breadth of public opinion communication are intertwined with “multi-narrative”, forming a resonance of control of coronavirus.”

Although China has banned digital currencies within its boundaries, its central bank PBoC is aggressively working on a central bank digital currency (CBDC) plan. China’s CBDC ambitions grew after Facebook announced its Libra cryptocurrency earlier this year in June 2019. Chinese government officials say that its CBDC move is to counter any external threat to its financial stability.

Last October, Chinese President Xi Jinping declared that China would “seize the opportunity” investing in blockchain, stressing that China should join the world in setting standards for this emerging technology. The president’s remarks on the blockchain have done more than just increase public awareness of the technology, it also resulted in large rallies in China’s blockchain-related assets.

China seems to be set on blockchain’s potential, but this announcement is a shift from previously negative policies towards blockchain and cryptocurrencies. In 2017, China banned cryptocurrencies, their mining, and initial coin offerings, all efforts to tighten controls on risky investments. Obviously, the real challenge for China, it seems, isn’t using the blockchain. It’s figuring out where a hot technology is actually useful.